Series 6, section 2

• Paper act
• Primary offerings

• Private offerings
• 35 non accredited purchasers
• accredited - $1mil or more

People act

Broker side charges a commission and there is no risk. In an agency capacity

dealer - They act for their own account. Principal transaction. Lots of risk. They buy for their own inventory. No commission - they charge a mark-up. Stocks, not mutual funds

Any evidence of ownership, document or contract where performance depends upon third party management. Must be registered unless exempt

They sell advice. Don't need a 65 if your advice is incidental to your profession. These are managers of mutual funds. (investment advisors) They charge a management fee.

An investment adviser who is regulated by the SEC. Manage large accounts like mutual funds.

State covered adviser manages smaller stuff

• Mutual fund law.
• 3 types of investment companies.
• -management company
• -unit investment trust
• -face amount certificate company

• Martha Stewart
• Michael Milken

• Financial Industry Regulatory Autority
• Over the counter market (NASD)
• Exchange market (NYSE)

It has RULES, not laws. Like Realtors Asso.

The date the application is accepted by the insurer.

Seven days

8.5% of the ask price. (public offering price)

No sales charge

The fee charged by the underwriter of a mutual fund. A $10 purchase becomes $9.15 after passing through the hands of the underwriter.

it is an asset based sales charge. May not exceed 6.25%. Distribution fee

everybody

Dividend from a mutual fund that is taxed at the same rate as capital gains. Currently 15%

• Yield is dividend/cost basis=yield
• Total return adds dividend+appreciation/cost basis=total return

The exclusion ratio is the non taxable portion of an annuity payment. If you paid in $20,000 and when you annuatize your life expetancy is 20 years then $20,000/20=$1000  So you have $1000 tax deduction off of your annuity payout.

Zero! it is payed with before tax dollars. It is in the tax later bucket

• it MAY be. Don't assume it is.
• If you are covered by another tax deductable plan at work and you make too much money, then you can't deduct it.

IF it is a qualified Roth, then the distributions are tax exempt IF held for more than 5 years. That is big! No tax on the gain. But 59 1/2 rule applies or 10% penalty.